Ford Motor Company of Australia Ltd v Lo Presti

Ford Motor Company of Australia Ltd sued Lo Presti in the Supreme Court of New South Wales, seeking damages for breach of contract. Lo Presti counter-claimed for damages for breach of contract. The dispute centred on indemnity costs, specifically whether the trial judge had correctly assessed the reasonableness of Ford's rejection of Lo Presti's Calderbank offer. The Supreme Court of New South Wales heard the case and found in favour of Lo Presti, awarding indemnity costs against Ford. Ford appealed to the New South Wales Court of Appeal, which had to determine whether the trial judge had applied the correct test in assessing the reasonableness of Ford's rejection of the Calderbank offer and whether the judge had properly considered public policy in the resolution of litigation.

The court found that the appeal did not challenge the correctness of the test formulated by the trial judge for assessing the reasonableness of Ford's rejection of the Calderbank offer. The appeal only argued that the trial judge had misapplied the test. The court held that the trial judge had not erred by failing to give separate or individual attention to public policy considerations. The court emphasised that public policy considerations were part of the context in which the court evaluated the reasonableness of the rejection of a Calderbank offer, but they did not require separate or individual attention in deciding whether to make an award of indemnity costs in a particular case.

The appeal was dismissed, and the trial judge's decision was upheld. The New South Wales Court of Appeal determined that the trial judge had correctly assessed the reasonableness of Ford's rejection of Lo Presti's Calderbank offer and had not erred by failing to give separate or individual attention to public policy considerations. The court found that the appeal did not challenge the correctness of the test formulated by the trial judge, only that the trial judge had misapplied the test. Therefore, the trial judge's decision was upheld, and Lo Presti was entitled to indemnity costs against Ford.